Universal Property & Casualty Insurance Settles Cybersecurity Case

Universal Property & Casualty Insurance has agreed to settle a class action lawsuit involving alleged cybersecurity issues. Plaintiffs in the lawsuit allege that their insurance documents were visible on the Lender Verification Portal with inadequate security measures to protect sensitive information. Universal Property claims that its website security is sufficient, but is choosing to settle the class action lawsuit to avoid further litigation.

The class action settlement includes individuals who were insured with Universal Property between Sept. 1, 2013 and Mar. 31, 2016.
Court documents show that the class action lawsuit was filed in March 2016 by four Universal Property customers. The plaintiffs allege that their insurance declaration and evidence of insurance pages were available on the Lender Verification Portal, but the website did not have the appropriate safety measures to protect sensitive information.

On Feb. 14, 2017, the class action settlement was preliminarily approved. Eligible plaintiffs have until Jun. 14, 2017 to opt-out of the settlement.

A class action lawsuit consists of one complaint representing a group of plaintiffs (called a class) against a common defendant or defendants. All plaintiffs allege that they were wronged by the defendant in the same manner. In this case, plaintiffs alleged that the insurance company failed to protect customers’ sensitive information due to inadequate safety measures on their website.

The lawsuit does not allege that that documents have been accessed or that the plaintiffs have sustained any losses due to the alleged cybersecurity issues. As part of the settlement, Universal Property agreed to provide ID Experts’ managed recovery and restoration services to Class Members who become victims of identity theft. Universal Property has agreed to make the services available for two years from the settlement’s effective date. The settlement also offers identity theft reimbursement insurance through ID Experts.

Recent Data Breach Lawsuits

Other companies have faced class action lawsuits involving data breaches. Home Depot recently agreed to pay $25 million to settle a putative class action brought by financial institutions. The lawsuit stemmed from a 2014 data breach where hackers stole sensitive financial information by installing malware onto the stores’ self-checkout kiosks. A total of 56 million credit and debit card numbers were stolen.

Yahoo also recently made headlines over two separate data breaches. The first breach was announced in September 2016, when Yahoo said that 500 million people were affected by a cyberattack in 2014. Then in December, Yahoo announced a second data breach that took place in 2013; over 1 billion accounts were affected.

The Yahoo data breaches compromised names, phone numbers, birth dates, encrypted passwords and security questions. Government agencies are now investigating the data breach. Yahoo said in a November 2016 SEC filing that it was cooperating with the SEC, Federal Trade Commission and other government authorities including “a number of State Attorneys General, and the U.S. Attorney’s office for the Southern District of New York.”

One class action was filed against Yahoo alleging that the data breach resulted in identity theft. A business owner who uses Yahoo filed a lawsuit in the U.S. District Court for the Northern District of California alleging that unauthorized purchases were made on his Capital One credit card and Chase debit card. Although Yahoo says the data breach only affected email security, the suit alleges that “Given that more than three years elapsed before Yahoo disclosed the 2013 data breach and more than two years passed before Yahoo disclosed the 2014 data breach,” the plaintiff “is rightfully skeptical of Yahoo’s self-serving statements,”

According to the complaint, the data breach caused the plaintiff to become a victim of identity theft. Both cards were on file with Yahoo and the plaintiff alleges that no other company had access to those cards.